Fred's Reports October Sales And Sets Date To Release November Sales And Third Quarter Financial Results

Fred's Inc. (NASDAQ: FRED) today reported sales for the four-week fiscal month of October, third quarter and nine-month year-to-date period ended on October 29, 2016.

Fred's Inc. (NASDAQ: FRED) today reported sales for the four-week fiscal month of October, third quarter and nine-month year-to-date period ended on October 29, 2016.

Fred's total sales for the month decreased 4.2% to $157.3 million from $164.2 million in October 2015. Comparable store sales for the month declined 3.4% compared with an increase of 2.3% in the year-earlier period.

Total sales for the third quarter of 2016 were $516.7 million, down 4.5% from $541.0 million in the same period last year. Comparable store sales for the quarter declined 3.8% compared with an increase of 2.7% in the third quarter of 2015.

Fred's total sales for the year-to-date period were flat at $1.596 billion versus $1.596 billion for the same period last year. On a comparable store basis, year-to-date sales declined 1.7% versus an increase of 1.5% for the year-earlier period.

Commenting on the announcement, Michael K. Bloom, Chief Executive Officer, said, "While we continue to make broad progress in addressing the issues that have affected our sales over the past several months, these improvements were obscured primarily by four discrete factors in October that prevented us from hitting our sales expectations for the month. In the front store, we encountered unexpected challenges in our transition to a third-party distributor for several key categories. October sales also were affected by the calendar shift for Halloween, as we cautioned last month, which pushed the holiday into the fiscal month of November this year versus October last year. Significant reductions in SNAP payments and warmer-than-expected weather during the month also contributed to October's sales decline. Retail pharmacy sales continued to be pressured by the ongoing shift to 90-day prescriptions, as expected, but our specialty pharmacy sales, while still running below last year's level due to an industry-wide slowdown in Hepatitis C drugs, gained further ground in October with month-over-month growth. Outside of these headwinds, which we consider to be transitory, as well as the tough comparisons we have faced against last year's sales, we remain confident in the strategic path for Fred's. With the key initiatives we have in place to drive future growth and improve profitability, we continue to make bold strategic shifts in our business."